1. The article discusses the growing importance of product managers for software companies but notes that talent management for product managers is often underdeveloped. 2. It finds that fewer than half of product managers feel prepared for their roles or able to advance, and surveys show gaps in coaching, mentoring, and career progression. 3. The article recommends that companies articulate clear leadership models for product managers, provide ongoing learning opportunities, implement end-to-end learning programs, and prioritize strategic recruiting to develop world-class product management talent.

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Article
November 2018
The product management talent
dilemma
By Chandra Gnanasambandam, Martin Harrysson, Shivam Srivastava, and Vaish Srivathsan
P
Despite product managers’ central roles in software organizations,
they are often neglected from a talent-management perspective.
Four levers can address this industry-wide challenge.
roduct management remains one of the most critical roles for any company for
which software is a core growth driver. Amid the growing importance of data in
decision making, an increased customer and design focus, and the evolution of software-
development methodologies, the role of the product manager has evolved to influence
every aspect of making a product successful. As a result, CEOs and technology leaders
often identify the role of product manager as one of their top talent priorities.
Paradoxically, results from the McKinsey Product Management Index reveal that
companies are underinvesting in this crucial talent pool.
The McKinsey Product Management Index is a survey of product managers at leading
software companies to understand the capabilities and enablers that create top-
performing product managers (Exhibit 1). This research surfaced systemic gaps around
software-talent management; in fact, fewer than half of the product managers feel
prepared to play the roles expected of them or grow into future product leaders.

High Tech

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Exhibit 1

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Product managers spend time across a range of
critical areas and influence every part of the
product
The McKinsey Product Management Index highlights the wide range of activities that
demand the attention of product managers. The days and weeks of an average product
manager are fragmented, which requires they be good at wearing multiple hats and
prioritizing ruthlessly (Exhibit 2).

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Exhibit 2
Modern product managers are involved in a wide range of decisions. For example, nearly
80 percent of product managers actively participate in design activities, over 80 percent
are involved in go-to-market decisions, and nearly half are involved in pricing decisions.
Additionally, 60 percent of product managers have basic analytics skills that enable them
to dive into metrics and draw insights without relying on analysts.

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Talent management is a pervasive gap
Despite the central role that a product manager plays, the talent-management practices
associated with this function are surprisingly underdeveloped. This gap is evident across
the industry—at large software companies in Silicon Valley, early-stage tech companies,
and incumbents in other industries that are becoming more software oriented.
As an example, only 35 percent of the product managers have clarity on what it would
take to advance in their organizations, roughly the same number feel sufficiently coached
and mentored and around 20 percent say that their companies have highly effective
programs to identify and retain the best talent.
We observe several underlying drivers for this gap in talent development. First, there are
limited roles that involve managing people and teams in the product organization, and
unlike in engineering, companies have not consistently defined an expert track for
product managers. This can prevent product managers from growing or feeling that their
careers are progressing unless they are managing more people.
Additionally, the leadership development model for product management—that is, the
behaviors and mind-sets that product managers are expected to display at various levels
—is often poorly articulated. As a result, the only way to measure product managers is on
the success of their product. Product managers tell us that they believe career
progression at their companies is a matter of being in the right place at the right time to
become part of a hit product rather than of doing the right things.
What is more, product management primarily requires learning on the job, but few
software companies have put in place mechanisms to support this learning. Product
managers often start in other functions, such as engineering, design, or marketing, and
bring a specific set of skills from their previous roles. But this transitioning talent needs
support to wear the multiple hats required of product managers.
Compounding the issue is the fact that product managers make up a small talent pool at
most companies and hence often end up lower on the agenda of HR leaders.

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Several elements can help companies build a world-
class product management talent program
There are four key levers to pull to build a world-class program for product management
talent.
First, articulate the product management leadership development model for the
organization. This should include a concrete, actionable description of what the
organization wants and expects from its product managers. It should reflect the
organization’s strategy and priorities and is not the same as the conventional list of
competencies used to assess employees. For example, competency models are often
expressed as innate traits, qualities, or values that product managers should have, such as
“is decisive,” whereas a leadership model is expressed as concrete descriptions of desired
behaviors, such as “acts to reach timely closure on decisions.” The leadership model
should also articulate what it looks like to make different transitions in the organization.
For example, how do the behaviors and mind-sets differ for an established, principal
product manager from one who is transitioning to a director of product.
Second, provide the product managers with organizational enablers for ongoing growth
and apprenticeship. There are many ways to do this, including rotational programs,
regular cadence of product reviews (with focus on coaching and knowledge sharing
rather than inspection), walking in the shoes of other functions (taking support calls or
doing customer demonstrations, for example), conducting skip-level one-on-one
sessions, providing formal mentorship programs, giving regular growth-based feedback,
and so on.
Third, leverage a field-and-forum approach to design an end-to-end learning journey.
There are several principles and approaches for learning programs that we have
discovered through our work with technology companies. The first is that product
managers, like most adults, learn best by doing rather than by watching videos or sitting
in classrooms. Additionally, product managers learn most effectively through activities
that are grounded in their day-to-day context rather than through generic product
management trainings. For example, we have run a product management academy
program in which product managers take on ambitious projects and are coached through
them on a weekly basis (Exhibit 3). It is important to note that these learning programs

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must be tailored to the different transitions that are critical for the individual
organization. Additionally, it is important to put hard metrics on the “soft stuff” by
tracking key performance indicators for these programs that measure both participation
and subsequent effectiveness.
Exhibit 3
Last, hiring should be a strategic priority for senior leadership. At best-in-class software
companies, senior product managers often report spending 3 to 5 percent of their time
(equivalent to a half day to a full day per month) on recruiting. Doing recruiting well
includes getting three elements right:
1. identifying and articulating the organizations’ unique value proposition
for product managers
2. leveraging diverse sourcing channels (using online communities like
Hacker News, sponsoring meet-ups, identifying internal talent in other
functions that are likely to produce product managers, and making
“acqui-hires,” for example)

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3. a recruiting process that is efficient, removes unconscious biases, and
tests real-life skills (through cases, actual presentations on product
ideas, analyses using real product data, interactions across functions to
test the ability to work with engineering and design, for example)
Product management is one of the most critical talent pools for any company that is
writing software but often does not get the right level of attention. Having a world-class
product management function requires a multipronged approach under a holistic talent-
management program. We recommend that this be a joint priority of the chief HR officer
and the head of product.
About the author(s)
Chandra Gnanasambandam is a senior partner in McKinsey’s Silicon Valley office,
where Martin Harrysson is a partner, Shivam Srivastava is an associate partner,
and Vaish Srivathsan is a consultant.